Member access

4-Traders Homepage  >  Indexes  >  CHINA-Shanghai Comp       

End-of-day quote. End-of-day quote  - 04/18
2097.73   -0.07%
3d agoDJStocks Rise For Fourth Straight Day
3d agoDJStocks Rise For Fourth Straight Day
3d agoDJStocks Pause After Three-Day Rally
SummaryChart AnalysisNewsAnalysis 
Analysis summary4-Traders Strategies 

CHINA-Shanghai Comp : Chinese market is getting back into shape

02/21/2013 | 10:19am
Opinion : Check out the trading range breakout  2150/  2450

The Shanghai Stock Exchange rose nearly 25% in the last sessions while signs of improvement started to be seen as the economy is accelerating under the monetary control of Beijing. And this could be the beginning of a strong catch-up which could take place in 2013. The Chinese stock is one of the few remaining stock markets to be negative this year. In fact, more good news reassured investors and suggested that the second largest economy hit a bottom in 2012 and could see a new economic upturn next year.

The Chinese economy has shown more and more reassuring signs of upturn since the middle of 2012.The services PMI stood at a peak of four months in favor of a continued increase in new orders and good employment performance. The rapid growth of the service sector in China has been confirmed by the PMI index established by HSBC, last sign in date that economic activity is gaining strength. This index reached 54 in January against 51.7 in December. According to economists, China is expected in 2013 to see an increase by 8.1% of gross domestic product (GDP), after 7.8% in 2012, the lowest in 13 years. These indicators show an increase for the sixth consecutive month, a development that strengthens the hypothesis of a stronger recovery of growth than expected in China.

The improvement reflects the government investment projects announced in the second quarter of 2012 and which begin to produce their effects on the economy. This important upturn in the activity can be explained by good figures in construction and distribution industries. The strength of China's services sector shows that the Chinese economy quickly came out of its slump. Investors could take interest in the Chinese stock market again.

For several months we have strongly advised you to take long positions on China taking profit of the recovery. The index reached a medium term key level. Technically, the dynamic is bullish in weekly data above 2200 points which refers to the 20-week moving average. In the short term, we show some caution because a necessary consolidation towards 2200 points could take place in case of a break below 2450/2500 points. In contrast, a weekly break above this resistance would make us take new long positions towards 2850 points. Any decline on 2150/2200 points will also be a buying opportunity. However a larger decline to 2150 would invalidate our scenario. We can play this bullish trend thanks to a tracker on CSI 300 (IE00B5VG7J94).

CHINA-Shanghai Comp : CHINA-Shanghai Comp : Chinese market is getting back into shape
Copyright (c) 2014 4-Traders.com



React to this article

Disclaimer: 4-traders.com is a website published by SURPERFORMANCE SAS. Surperformance or 4-traders.com is not a registered broker-dealer nor a registered investment adviser. You understand that this web site and its content is furnished for your personal, noncommercial, informational purposes only, and that no mention of a particular security in this website constitutes a recommendation to buy, sell, or hold any other security, nor that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. Surperformance and 4-traders.com services will not advise you personally concerning the nature, potential, value or suitability of any particular security, portfolio of securities, transaction, investment strategy or other matter. Information regarding trading and investment as provided by Surperformance professional is not tailored to the investment needs of any specific person. You acknowledge that you are responsible for your own financial decisions and should seek a registered financial agent depending on your own risk tolerance to advise you on your personal trading activities.

Advertisement
Dynamic quotes  
ON
| OFF